Correlation Between Nmb Financial and PacWest Bancorp
Can any of the company-specific risk be diversified away by investing in both Nmb Financial and PacWest Bancorp at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Nmb Financial and PacWest Bancorp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Nmb Financial Corp and PacWest Bancorp, you can compare the effects of market volatilities on Nmb Financial and PacWest Bancorp and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Nmb Financial with a short position of PacWest Bancorp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Nmb Financial and PacWest Bancorp.
Diversification Opportunities for Nmb Financial and PacWest Bancorp
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Nmb and PacWest is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Nmb Financial Corp and PacWest Bancorp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on PacWest Bancorp and Nmb Financial is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Nmb Financial Corp are associated (or correlated) with PacWest Bancorp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of PacWest Bancorp has no effect on the direction of Nmb Financial i.e., Nmb Financial and PacWest Bancorp go up and down completely randomly.
Pair Corralation between Nmb Financial and PacWest Bancorp
If you would invest 1,475 in Nmb Financial Corp on November 29, 2024 and sell it today you would earn a total of 1.00 from holding Nmb Financial Corp or generate 0.07% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Nmb Financial Corp vs. PacWest Bancorp
Performance |
| Timeline |
| Nmb Financial Corp |
| PacWest Bancorp |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
Nmb Financial and PacWest Bancorp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Nmb Financial and PacWest Bancorp
The main advantage of trading using opposite Nmb Financial and PacWest Bancorp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Nmb Financial position performs unexpectedly, PacWest Bancorp can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in PacWest Bancorp will offset losses from the drop in PacWest Bancorp's long position.| Nmb Financial vs. First IC | Nmb Financial vs. Merchants Marine Bancorp | Nmb Financial vs. United Bancorporation of | Nmb Financial vs. U I Financial |
| PacWest Bancorp vs. Zions Bancorporation | PacWest Bancorp vs. KeyCorp | PacWest Bancorp vs. Comerica | PacWest Bancorp vs. First Horizon National |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Commodity Channel module to use Commodity Channel Index to analyze current equity momentum.
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